manufacture, mechanism, merchandise, commodity, convenience, repair," is not sufficient to extend the statute to services contracts. The sale by a gas company of a franchise to sell gas to a light company is not a combination prohibited by the act. The purpose of the statute is to prohibit combinations between competing enterprises. Fort Smith Light & Traction Co. v. Kelley, 94 Ark. 461, 127 S. W. 975 (1910). A rate-fixing agreement, entered into by a foreign insurance company as to business outside the state, was held sufficient ground for a proceeding pursuant to section 9408 in Hartford Fire Insurance Co. v. State, 76 Ark. 303, 89 S. W. 42 (1905). The legislature has the power to dictate the terms upon which foreign corporations can do business in the State. Hammond Packing Co. v. State, supra. Cf. State. v. Lancashire Fire Insurance Co., 66 Ark. 466, 51 S. W. 633 (1899); State v. Aetna Fire Insurance Co., 66 Ark. 480, 51 S. W. 638 (1899), decided under a prior statute. The earlier act of 1905 which invalidated sales by parties to price-fixing agreements and authorized recovery of the purchase price by the buyer, was held not to apply to a sale of goods for interstate shipment into Arkansas. Frank A. Menne Factory v. Harback Bros., 85 Ark. 278, 107 S. W. 991 (1908). Transactions of parties alleged to have participated in combinations in violation of the statute but having no connection with the combinations are not invalid. Midland Valley R. Co. v. Hoffman Coal Co., 91 Ark. 180, 120 S. W. 380 (1909); Epstein v. Buckeye Cotton Oil Co., 106 Ark. 241, 153 S. W. 587 (1913). Enforcement Provisions. The failure of a corporation to file the affidavit called for by section 9414 is not a violation of the statute and the corporation is not liable to forfeiture of its charter for such failure on the ground that the section does not contain an express requirement and, being penal in nature, must be strictly construed. State v. International Harvester Co., 79 Ark. 517, 96 S. W. 119 (1906). An honest, reasonable effort to comply with an order to produce witnesses and documents under section 9415 is sufficient compliance with the statute. Hammond Packing Co. v. State, 81 Ark. 519, 100 S. W. 407 (1907) aff'd. 212 U. S. 322, 29 Sup. Ct. 370, 53 L. Ed. 530 (1908). Enforcement proceedings under the statute are not criminal in nature but are statutory actions for the recovery of penalties. Ibid. Defense. A plea by the defendant corporation that the corporation has been voluntarily dissolved, will abate action by the attorney general for violation of the statute. State v. Arkansas Cotton Oil Co., 116 Ark. 74, 171 S. W. 1192 (1914). B. EXCEPTIONS TO GENERAL ANTITRUST LAWS Dig. Stat. (Pope, 1937) Resale Price Maintenance Sections 5606 to 5614 validate contracts fixing the resale price of branded commodities. The statute is expressly inapplicable to horizontal agreements between producers, between distributors, or between retailers. See Vol., State Price Control Legislation: Resale Price Maintenance. Cooperatives Section 2310 provides that no cooperative agricultural marketing association organized under the cooperative marketing act, sections 2286 to 2314, shall be deemed to be a combination in restraint of trade or an illegal monopoly. See Tying Contracts and Exclusive Dealing Arrangements, infra. C. SPECIAL ANTITRUST LAWS 1. Special Industry Antitrust Acts CONSTITUTIONAL PROVISIONS Transportation Const. art. XVII, sec. 4, provides that no railroad or canal company shall consolidate with or purchase or control the property of any other railroad or canal company owning or controlling a parallel or competing railroad or canal and that the officers of one company cannot be officers of a competing company. The question whether a railroad or canal is a parallel or competing one is for the jury. STATUTORY PROVISIONS Section 1080 provides that combinations or contracts for the pooling of freight by dividing the earnings of railroads or by equalizing or dividing between railroads the property or passengers carried, are unlawful. Sections 11085, 11093, and 11109 to 11111 provide that parallel or competing railroads shall not consolidate or merge. Insurance Section 7663 provides that insurance companies which are parties to any pool, combination, or agreement to regulate, fix, or maintain rates for property insurance are prohibited from doing business in the State. (Identical with sec. 9408, General Antitrust Laws, supra.) See also secs. 9410 and 9414, supra. Mining Sections 9407 and 9414 provide that the prohibition against combinations to fix prices of commodities specifically includes any products of mining. See General Antitrust Laws, supra. Liquor Section 14122 provides that it shall be unlawful for a manufacturer (a) to be interested directly or indirectly in any premises where malt, vinous, or spirituous liquors are sold at retail, or in any business devoted wholly or partially to the sale of such liquors at retail, by stock ownership, interlocking directors, mortgage or lien or any real or personal property or any other means; (b) to make any loan to any owner. Liens or other interests acquired on or before December 31, 1933, are not included within the provisions of this section. L. 1939, Act 352 Section 1 provides that it shall be unlawful for any manufacturer, rectifier, wholesaler, salesman, carrier, or their agent, or any vendor of alcoholic or malt beverages to give any article of value or to make any loan, directly or indirectly, to a person engaged in the retail liquor business, or to any employees or agents thereof, or perform any services for the benefit of any retail liquor dealer; nor shall they sell any article to a retail liquor dealer other than alcholic and malt beverages at the posted price; it being the intention of this section to prohibit them and their employees from offering any inducement such as secret discounts, rebates different from the posted price, or any loans, gifts, or fictitious sales to induce a retailer to purchase such beverages, and any such gifts, loans or sale, or rebates or discounts to induce such purchase shall be deemed a violation of this section. Section 6 provides than any person violating any of the terms or provisions of this statute shall, upon conviction, be fined in any sum not less than $25 nor more than $100, and shall be cause for the Commissioner of Revenues, in his discretion, to revoke the license or permit of the person violating any of the provisions of this statute, whether convicted or not, if, in his opinion, such person is guilty of violation of any of the provisions hereof. Dig. Stat. (Pope, 1937) Section 14205 provides that no manufacturer, distributor, or wholesaler to whom this act applies shall have any interest, directly or in directly, in the business of any person applying for and securing or holding a permit as retail dealer, or in the furnishings or fixtures used in his place of business, or any lien thereon. Section 14222 provides that any violation of the provisions of this act, or of rules and regulations made pursuant thereto, shall be a misdemeanor, and where a penalty is not specifically stated, shall be punishable by a fine of not more than $500 and imprisonment for not more than 6 months in the discretion of the court. See Tying Contracts and Exclusive Dealing Arrangements, infra. 2. Public Contract Provisions Dig. Stat. (Pope, 1937) Section 11893 provides that the State Purchasing Board may reject all bids for public printing when it believes there has been a combination among the bidders. See projected Vol., Government Purchasing. 3. Anticoercive Financing Statutes Dig. Stat. (Pope, 1937) Sections 9419 to 9433 are identical in text with the California statute. See Cal. Gen. Laws (Deering, 1937), Act 5137, secs. 1 to 15. set forth in full at pp. 50-54, infra. Judicial Decisions Public Contracts Provision. In an action to restrain Board of Commissioners from advertising anew for bids, the Court held that the legislature may disaffirm a contract for public printing upon evidence that the successful bidder was a member of a combination to suppress bids and stifle competition, such a contract being invalid as against public policy. Woodruff v. Berry, 40 Ark. 251 (1882). II. CONTRACTS NOT TO COMPETE No statutory provisions. Judicial Decisions Restrictive Covenants Ancillary to the Sale of a Business. * * * The general rule as expressed by one court is: "This court has upheld contracts in partial restraint of trade but in doing so we have recognized that where the contract results in the creation of a monopoly it is void as contrary to public policy." Patterson v. Rogers, 148 Ark. 222, 229 S. W. 711 (1921). Under this rule it has been held that a contract in reasonable restraint of trade with reference to a particular business, where ancillary to its sale and the goodwill thereof, is valid and enforceable. Wright v. Marshall, 182 Ark. 890, 33 S. W. (2d) 43 (1930); Bloom v. Home Insurance Agency, 91 Ark. 367, 121 S. W. 293 (1909); Kimbro v. Wells, 112 Ark. 126, 165 S. W. 645 (1914). Application of Statute. A contract not to compete is not in violation of section 9407 et seq., when its purpose is not to stifle competition. Bloom v. Home Insurance Agency, supra; Kimbro v. Wells, supra. It has been repeatedly held that a contract not to compete in the same city, town, or county is a reasonable restraint of trade and the restriction will be enforced. McClure v. Young, 193 Ark. 188, 98 S. W. 2d 877 (1936); Hultsman v. Carroll, 177 Ark. 432, 6 S. W. 2d 551 (1928); Kruger v. Strom, 174 Ark. 1179, 298 S. W. 882 (1927); Robbins v. Plant, 174 Ark. 639, 297 S. W. 1027 (1927); Barnett v. Mays, 153 Ark. 1, 239 S. W. 379 (1922); Wakenight v. Spear & Rogers, 147 Ark. 342, 227 S. W. 419 (1921); Harris v. Irby, 146 Ark. 403. 225 S. W. 635, (1920); Hampton v. Caldwell & Hall, 95 Ark. 387, 129 S. W. 816 (1910); Daniels v. Brodie, 54 Ark. 216, 15 S. W. 467 (1891). A contract not to compete for a specific term of years when ancillary to the sale of a business is enforceable as a reasonable restraint. A contract not to compete for periods up to 20 years has been held valid. McClure v. Young, supra; Kruger v. Strom, supra; Robbins v. Plant, supra; Harris v. Irby, supra; Daniels v. Brodie, supra. It has also been held that a contract not to compete as long as the purchaser engages in that business is valid and enforceable. Hultsman v. |